>> wire both sides saying let's just get this done and take this problem off of the table? >> i do not know. anybody else -- there must be some insight regarding the reliability of the grid is reliable. i had no idea why they would go along with that. and from it is the lawyers. >> doctor? >> i think as we look at the bigger picture, and the substances that are being used by athletes, we talked earlier about the supplement you can buy on the internet and in health food stores that may or may not contain illegal substances. i think a lot of athletes that i talk with who have gotten caught in drug testing, they say that all i did was go to gnc and by a

protein powder or a muscle product and i didn't know that it had anabolic steroids and and or whatever it was that broke the rule. i think there is some concern that this is the bigger issue in i think some athletes may be concerned that they are going to do the right thing, but also get caught doing something could be wrong. i think as we look at this, as the pair has been talking about, the issue of unregulated supplements is a huge issue that needs to be addressed. >> that is the can of worms that we don't have time to deal with. but i do want to take another step back. i do not want to diminish the negative impact that these banned substances or any other substance has on our players after they retire. as they are moving forward, i would be concerned to say what

is the appropriate role of the federal government? i realize that it is funded by people like mr. dick bukus, he has an honored to be in the same room -- i am so honored to be in same room as him. but is there way to work this out without the federal government being involved in and? i will entertain the comments from anybody on the panel. mr. michael gimbel, i would like to say that when the first steroid hearings were held, i think it open up a dialogue and it opened up to the american people about performance enhancing drugs in major league baseball at the time. i think that with such an important role that this committee did, because it gave us to work with kids, a lot of knowledge and leverage and it

also focused on college and high school athletes, not only about the dangers, but the consequences. there is a definite role in doing that this committee has been doing. we just dialogue and awareness and educating the public. >> obviously, aren't we protecting our children is absolutely critical. but i do hear from people when i am back home. you are about to go off the fiscal cliff. what are you doing having a hearing on it. let me just finish by saying that if the public was aware of a number of our children were taking some level of these performance-enhancing drugs, they would be demanding these hearings. because if it were cocaine or other drugs, they would be saying i would be not do anything? >> in regards to the illegal use

-- are we trying to educate the public? >> i think that is a huge role. i think we are trying to clarify the questions and make it very clear about what the role is about what we can and can't do, what we can control and we can. i would like to thank everyone for being here. mr. chairman, i would like to thank everyone for the opportunity. >> sir, perhaps i can answer one of your constituents concerns for the ranking member. that is the one thing i get asked all the time it can congress do more than one thing at a time. to a great extent, yes, there are leadership working on the fiscal cliff. there are those working on what they are doing, and this committee wasn't supposed to be in session is trying to take

full advantage of doing is many things as we can. i might note that the gentleman has been incredibly helpful in doing oversight on a lot of things. people may not have understood him it until we started finding out, for example, hydraulic fracturing was under attack. so i would like to thank the gentleman for multitasking and his wife as well. mr. trey gowdy, before we close, would you like to do a second round of questioning? >> no, sir, mr. chairman. >> ague. i would then yield to the ranking member chris pozen. again, i would like to thank all of you for being here today. one of the things that i say to my children, i tell them, mr. dick bukus, i tell them and i try to figure out what is the enemy of destiny. what is the enemy of your destiny? because i believe that if they

try to figure out what might block them in getting to where they have to go, that they will begin to change those things now so that they can get to where they are trying to go. i would hate to think that the enemy of people's destiny is him looking up to athletes who may be pulling something improper, and then they try to emulate that. we have our chance. that is one thing that i know about you all. the question is what chances are

we blocking our children from having? so the testimony has been very insightful and helpful. hopefully as we move down the line, the players will see how incredibly ridiculous it looks. maybe they need to talk to their lawyers. we have to move up, we had to move down the line, and it doesn't look very good. if you can't carry through with it, the least showy good reason why you can. then make it so that there is a way forward. if you can come and get it done. right now, we are not seeing that.

but your testimony has been very helpful. you have put in the record, not only the science, but the effect of the tribes on our young people today. thank you very much. thank you very much, mr. chairman. >> thank you, i want to again thank our witnesses. making the record is an important process. each of you has brought an insight. mr. dick bukus, even though you don't have a doctorate degree or a phd behind your name, your humbleness in recognition that you continue to have dedication to this sport being clean, it adds more than all the science can add a human side of this hearing. for our scientists, i want to thank you for beginning the process of making it clear that the testing regime has to occur and can occur and certainly has

occurred and most of the rest of the sports world. and again i would like to thank you for your time as we go into the holiday season and we stand adjourned. [inaudible conversations] [inaudible conversations] [inaudible conversations]

[inaudible conversations] thursday on "washington journal", grover norquist, the president of americans for tax reform, discussed republicans and negotiating the fiscal cliff and debating on the spending increases. then our guest from kaiser health talks about the potential impact of the fiscal cliff on medicare. "washington journal" starts at 7:00 a.m. eastern on c-span.

>> i've been on that list, they are as good as gold. >> all of us in this country are starting to see people coming out and talking about their experience of this phenomenon. though many of us have experienced this in one way or another and have no words for it other than adolescence when growing up. i think there was a moment where there was a possibility for change. the director and i, to start the film, i have the feeling that opinions are bubbling up and coming to the surface to say to say this is something that we can can't accept any more as

part of our culture. and he alone has followed up her award-winning film by gathering essays and personal stories together in her book, bully on "after words" on c-span2. find more booktv online and like us on facebook. >> north dakota senator kent conrad said goodbye to the senate on thursday. he chaired the senate budget committee and is involved in the fiscal deadline negotiations. senator conrad was elected to the u.s. senate in 1986. >> i have often joked with him that he has been my secretary on state and i have served here int the united states senate because he could count on senator dick lugar to give good and unbiased advice on complicated formulation issues. we will very much missed senator

lugar's voice in the united states senate, and also his hal, better half, charlotte, who i bt think we all know is a bright w ceite. senator, it has been an honor and privilege to serve with you, and i know that your voice will continue to be heard on important issues of the day.o i think you for your service to, our country and to your state, and thank you for being a good friend to me. mr. president, we have this long tradition in the senate by alert senators giving farewell remarks and i would like to alert that a my remarks will be especially long. becau you may want to have lunch and then come back. [laughter] i don't consider this my final speech because i'm hopeful that we farm bill. on hopefully we can reach agreement on averting the fiscal cliff. because that is important to thh

country.nd this is my farewell remarks. observations on 26 years of service here. it has been an incredible experience. the first thing i want to do is say thank youto you the you. h thank you to the people of north dakota are having confidence ino the united states senate. i was 30 years old, but i look d about 25.hey have i i treasure the confidence that they have had in me. i would also like to thank my ven colleagues and the responsibilities that they havep given me, the leadership team, senator kerry reed, senator echumer, senator murray.ff, iav

the confidence they have had ine me.been i have been so blessed to have people who have been with me, in many cases for more than 20 years. my chiefs of staff -- n timely dr me, care are garland, bob vanhuevland, wally, my legislative director who was with me for more than 20 years, tom mar, jerry gaginas, we all fondly call "mom," because she cracks the whip and makes sure the trains run on time. mary naylor, also has been with me more than 20 years. my deputies there, john rider

and joel friedman, who have done extraordinary work on behalf of the people of this country. stew nagerka, who is going to help me with charts today, my longtime communication communics director, and so many more. and most  of all to my family, my wife lucy, who has been my partner through all this, was my campaign manager when i first ran for the united states senate, my daughter jessie, who in in many ways has perhaps sacrificed the most because when you're in this job, you miss birthdays, you miss other important events. but she has been a great daughter, and she was here last night for our farewell party. and we had a lovely time. our son, ivan, and his wife kendra, who are in oregon where they have a small farm tawld tipping tree farm.

we wish they could be here today, our grandson carter, who is a proud member of the university of oregon marching band, the ducks, who served as an intern for me -- not at government expense, by the way, that was at our expense. and our little dog dakota, who has become sort of a mascot of the united states senate. brian williams when he did a show on a day in the life of senate concluded that program by calling dakota the 101st senator. and, you know, i think he will be missed perhaps more than i am as i leave the senate. in 1964 i came here, i sat up in the gallery, in fact, it was the gallery right up here. and i was 16 years old. and i watched a debate in the united states senate. it was on civil rights. hubert humphrey was leading that debate. and it so inspired me that i thought, you know, someday i'd like to be down on that floor

and i would like to debate the great issues of the day and i would like to represent the people of north dakota. and so i went home and wrote out on the back of an envelope that i would run for the united states senate in 1986 or 1988 and i ran in 1986. and was successful. that is the power of a plan. to you young pages who are here, if any of you seek to be in the united states senate someday, have a plan. because there are so many people who sort of drift through life without one, if you have a plan, you will be light years ahead. and in that race as i indicated my now wife, lucy, was my campaign manager. we won what was then believed to be the biggest political upset in the history of our state. and i was proud of that victory and proud to have a chance to

represent north dakota here. i think we all know that our country needs a plan now. and we know that plans have worked before. i was here in 1993 when we had just come off the largest deficit in the history of the united states, the country was in doldrums, the economy was just plugging along, not doing very well, just had a weak recovery from a deep recession. and we passed a plan to get the country back on track. we did it the old fashioned way. we made tough decisions, some that were unpopular, but it was the right thing to do and it worked. we balanced the budget, we had the longest period of uninterrupted economic growth in the nation's history, 23 million jobs were created, and we were actually paying down the debt of the united states at the end of the clinton administration. and we did it again when

disaster struck my state in 1997, one of the worst disasters ever in north dakota, a 500-year flood that followed the worst winter storm in 50 years, many of you may recall the images from that disaster when firemen were fighting an enormous conflagration in downtown grand forks in the middle of a blizzard, and a massive flood. grand forks was devastated. again, we had a plan, a $500 million disaster recovery plan that became a billion-dollar plan and it worked and we did it the old fashioned way, we made tough decisions, some that were unpopular, but it was the right thing to do and it worked. the community just held a recognition event for me this last weekend. and the leadership of the

community was there, and various aspects of the community. reporting on the remarkable recovery in grand forks. it is really i think, an example of what can be done when government responds and does so intelligently and effectively. now we face a new challenge. we have a fiscal cliff or a fiscal cliff curb or whatever one terms it, but what we know is if we fail to act, we could be pushed back into recession. our country needs a plan. a plan to get us back on track, to revitalize economic growth, to secure our long-term economic future, and to get the country moving again. and we can do it. we've done much tougher things in the past. you know, i hear people being critical sometimes when they leave here of this institution. let me say i'm not in their

ranks. i leave this institution with enormous respect. the united states senate is the greatest deliberative body in the world, and the vast majority of my colleagues, i sincerely believe, are serious minded and have the best interest of the country at heart. i really believe the vast majority of my colleagues want to do what's right for the country. we have differences, enormous differences, about what's the right thing to do, but i have no doubt most of our colleagues are well intentioned. in many circles it's fashionable now to bash government and play down its importance. i personally think we'd be well -- we would be well to remember what it has accomplished. i can remember so well-being called to an emergency meeting

in this building in the fall of 2008. i was handed a note that i was urgently requested to come here. it was about 6:00 in the evening, and it was the last one to arrive. when i walked into the leader's office there were the leaders of the house and the senate, republicans and democrats, the secretary of the treasury from the bush administration, and the chairman of the federal reserve. well, i instantly understood something very serious was afoot. they closed the door and told us they were going to take over a.i.g., the large insurance company, the next day. they weren't there to ask for our approval or seek our agreement. they were there to tell us they were taking this step. and they told us they were taking this step because they believed if they did not, there would be a financial collapse in this country within days. and they gave great speaker's

deskity -- great specificity if they failed to take the action they were about to do. the public reaction was harshly negative. the notion of the government of the united states bailing out a large private insurance company created controversy and criticism for almost every corner. ultimately, the rescue of that company cost $180 billion. a staggering sum. but you know what? we've just learned this week that the taxpayers will make money on the deal. yes, it cost us $180 billion. but the taxpayers are going to make $22 billion on the transaction. and if we hadn't done it, we

would have risked going into a depression. so when people say there's no role for government or it should just be a limited, shrunken role, really? would we have wanted to stand by and risk this country going into another great depression? let's recall what that was like. more than 20% of the people in this country out of work. i know my open grandfather -- own grandfather who refused to take bankruptcy owned stock in the local bank. in those days you had unlimited liability. if you owned stock in a bank. so when there was a run on the bank, as there was, he was called to bring money to the bank. which he did. and he did it over and over. and it took him nine years to recover. people were hungry. people were desperate.

that's what a depression is about. so when i reflect back to those decisions, i believe they were the right decisions to make, and it's not just my view. that's the view of two of the most distinguished economists in this country, mark zandi, who was a key economic advisor to john mccain in his presidential race, and alan blinder, the former deputy chairman of the federal reserve. here's what they say. without that federal response, we would have had eight million fewer jobs and 16% level of unemployment in this country, and we would have been in the second great depression. they call it depression 2.0. so, mr. president, let's remember where we were when president obama came to to office. the nation was facing the worst economic catastrophe since the

great depression. in the fourth quarter of 2008, the economy shrunk at a rate of almost 9%. now, after the federal actions, positive economic growth returned in the third quarter of 2009, and we've now had 13 consecutive quarters of economic growth. now, we've come a long way. this is a remarkable turnaround in a very short time, measured against previous financial crises. in fact, there's been an academic study just completed that suggests typically it takes eight to ten years to recover from a financial crisis. so the recovery here, while not everything we would have hoped, is a dramatic turnaround. at the same time, our constituents know, and we know, that the price has been high. we know that we are currently

borrowing 31 cents of every dollar that we spend. that's somewhat of an improvement because we were borrowing 40 cents of every dollar we spend. so this is an improvement but we've got a long way to go. and the public understands that we face both a spending and a revenue problem. spending is near a 60-year high, as this chart shows. the red line is the spending line, the green line is the revenue line. but for those who say it's just a spending problem, i don't think the facts bear that out. because the revenue is near a 60-year low. i think most logical people would say you've got to work both sides of this equation. and when we look at our debt, we see that our gross debt has now surpassed 100% of our gross

domestic product. there was a landmark work done just a couple of years ago by rogoff and reinhart. they looked at 200 years of economic history and they concluded once your debt exceeds 90% of your g.d.p., your future economic prospects are reduced and reduced significantly. future economic growth reduced by 25% to 33%. this is not just numbers on a page. this is a question of future economic opportunity. this growing debt is why many of us have called for action for a long time ago. in fact, it was six years ago this month that senator gregg and i came up with the idea of a commission to tackle the debt. that idea, ultimately led to the president appointing the simpson-bowles commission. its bipartisan report

recommended $4 trillion in deficit reduction in a balanced way and i think in a fair way protected low-income programs, it actually improved the progressivity of the tax system quite significantly, and it was balanced between revenue and spending. other bipartisan groups have concluded the same thing, that we need spending restraint and we need revenue. so there's a critical role for government here. we've seen it in the past, we'll find it in the future. but i think we also have to acknowledge there are problems here. there are problems in this chamber. as proud as i am of this institution, and i will forever be, i have detected over the 26 years i've been here a change. and it's happened kind of

gradually, but it's clearly happened. we spend now too much of our time seeking partisan advantage. and it happens on both sides. and it's all understandable. i understand it. i'm not being critical of individuals. we spend too little time trying to solve problems. we spend too little time in our caucuses, in our meetings, focused on how to solve the problems facing the country. i deeply believe that this observation is true. and i believe we can do better than this. the institutions of our government have a proud history. the genius of our founding fathers can be found in every part of our history. whether it was conquering the last great fretion or winning world war i and world war ii or launching a man into space or

conquering diseases, our government has bettered the plight of mankind. we need that kind kind of focus and effort now to address our challenges. i'm confident that we can do this. but it's not enough to be confident. it's not enough to be hopeful. it requires a plan, and i'd like to take just the next few minutes to lay out my belief of what that plan should include. mr. president, much of what i will talk about reflects the work of the bowles-simpson commission, the group of six i've been a part of, the group of eight, but it starts looking at what both sides have laid down. republicans have laid down, a spending cut plan, the president has laid down a revenue plan. my own belief is we should take them both. we should take what the

republicans have proposed on spending, with some modest modifications which i'll discuss, and we should take the president's plan on revenue. the president laid down a plan that said we ought to raise $1.6 trillion over the next ten years. boy, that sounds like an awful lot of money, doesn't it? $1.6 trillion. not billion, not million. trillion. and people will be quick to say oh, my god, that's the biggest tax increase history in of mankind. terrible. we can't do that. well, you know we need to put it in perspective. first thing we should recognize, this will take us to a revenue that is 19.9% of our g.d.p. the last five times we balanced the budget in this country, going back to 1969, we've been at 19.7%, 19.9%, 19.8%, 20.6%, 19.5%. does 19.9% kind of fit in there?

these are the only times we've balanced the budget going back to 1969. and to put it in each more perspective, how much revenue are we going to raise over the next ten years without any change? well, here's the number. $37.4 trillion. nobody ever puts these things in perspective, these big numbers in relationship to what. $1.6 trillion is in relationship to $37.4 trillion. as a percentage, that is an increase of 4.3%. my goodness, we can't increase the revenue by 4.3% in this country over the next ten years? of course we can. of course we can. especially if it means we get our house in order and put the

country on a firmer fiscal footing. and, you know, it doesn't just matter how much money you raise. it also matters how you raise it. we have got a tax code now that i can't defend. i can't defend. i took a study that was done by a man named martin sullivan last year. he did a very interesting thing. he looked at one building on park avenue in new york and he was able to do it because they happened to have the statistics that isolate that one building. do you know what he found? that the average income in that building was $1,167,000 for the

year. $1,167,000. the average tax rate of the people in that building was 14.7%. the janitor in that building had an income of $33,000 and he paid a tax rate of 24.9%. is this fair? is it fair that people making $1.1 million paid a tax rate of 14.7% and the janitor who served them, earning $33,000 a year, paid a tax rate of 24.9%? well, i personally don't think so. and i know all the arguments. i've served on the finance committee. i've heard it all. the biggest reason for this differential, by the way, is not the earned income tax rate, which has had almost all of the attention in this national discussion. almost all of the attention has been on the earned income tax

rate and raising it from 35% to 39.6%. almost no attention has been paid to the unearned income tax rate on capital gains and dividends. the unearned rate is currently 15%. that's what allows very wealthy people to pay a tax rate that is a fraction of those who work full time and are paying rates of 25%. so i hope that as we move to conclusion here, we'll pay a little more attention to the unearned rates. you know, the truth is, you could not go as much -- have as much of an increase as being proposed on the earned income side and have more of an

increase o unearned income side and you'd make the tax code more fair and you could raise the same amount of revenue. mr. president, so that's the revenue side. but the spending side, republicans have laid down, they've put out a proposal that asks for savings out of entitlements and other discretionary spending. and, you know, if you look at their proposal and you break it down, again, let's look at health care. we are going to spend $11 trillion over the next ten years on health care. republicans are proposing saving $600 million. if we had a compromise between republicans and democrats, let's say at $500 million, that would be a savings of, again, the magic 4%. we're going to increase revenue

4%. if we had savings on health care of 4.5%, we would save $500 billion. now, i mean, i've just had conversations with colleagues who've told me, we can't possibly save $500 billion out of health care. just like people say, well, you can't possibly increase revenue $1.6 trillion. really? we can't save $500 billion out of a pot of money where we're going to spend $11 trillion? i don't think that's true. i think we can save $500 billion. and i'll tell you, there's somebody sitting on this floor that's got a pretty good idea how to do it. senator sheldon whitehouse has said to us over and over and over, we are spending more than any other country in the world as a share of our national income on health care. we're spending 18% of our g.d.p. on health care. no other country spends more

than 11.5%. and the best minds in the country have told us we're wasting hundreds of billions of dollars in health care that don't improve health care outcomes at all. and if we would save money in overall health care, 40% of that savings would flow through to the federal government. senator whitehouse is right about this. we ought to focus like a laser on where the waste is. you don't need to increase the eligibility age for medicare. you absolutely do not have to do it to save $500 billion. but what it would do if you save $500 billion is it would keep the growth in health care spending about equal to the growth in the overall economy. that would stabilize the growth of health care spending. that would be a huge

contribution to the economic competitive position of the united states. now, mr. president, the republicans have also said, hey, let's save $300 billion on domestic discretionary savings. now, i'd be the first to say, we've already had lots of savings on the discretionary accounts. we've saved over a trillion dollars in the discretionary accounts. but they say, okay, let's save another $300 billion. i think we should say, we'll do it if you go with us on the revenue. we'll do it. because that represents savings of 2.6% of the $11.6 trillion we're going to spend in the discretionary accounts over the next ten years. now, i think, you know, we've kind of gotten into a situation here where we use numbers that are absolutely big numbers but we don't put them in perspecti

perspective. we can't save 2.6% out of the discretionary accounts? well, i believe we can. i absolutely believe we can. i believe we can save more out of defense. and i've been somebody, i've supported every penny. i didn't vote for going to war in iraq, thought that was a huge mistake, but i've supported every dollar of spending for our troops in the field. and i can tell you, as a budget committee chairman, we can save more money in defense. and there are lots of republicans who know we can do it, too. mr. president, other mandatory, that's another category the republicans said save $300 billion there. i think they're $100 billion too high because we've already saved over $100 billion out of other mandatory spending in the budget deal we did last year. so let's save $200 billion. that would represent, again, 4%

of what we are projected to spend over the next ten years in other mandatory spending. $5.1 trillion is what we're programmed to spend. $200 billion of savings there would represent 4%. again, i've had colleagues tell me, well, we can't possibly save $200 billion. i've had some staff people tell me we can't save $200 billion. so i say, okay, how much are we going to spend? how much are we going to spend? that $200 billion represents 4% of what we're going to spend. we can't save 4%? yes, we can. yes, we k. you know, -- yes, w. you know, i was elected on the slogan in 1986 of, "yes, we can." and somebody else used that slogan a few years later. president obama used that slogan "yes, we can." called me up, said, "do i owe you royalties?" i said, no, i'm glad you're

using it. but yes, we can. we need more of a "yes, we can" attitude around here. so when i rack it all up and i look at what we've already done, we've saved a trillion dollars in the budget control act of last year, and here -- here's other mandatory savings. i just talked about $129 billion that we've already done. $900 billion of other discretionary savings, already done. so we put that in the bank. we use that as the base. and you put it all together and here's what you've got. save another $200 billion on defense, have revenue of $1.6 trillion, which is the president's proposal, have $100 billion of non-defense. that gets you the $300 billion the republicans have asked for. on health care, you do $500 billion. that's close to what they've asked for. a hundred billion less. other mandatory, $200 billion. that's close to what they asked

for. a hundred billion-dollar difference reflects what we've already done. interest savings, because you're spending less and you have more revenue, you save interest, $400 billion. that gives you a total of spending cuts of $1.4 trillion. you add in what's already been done, $1,05 trillion and you've got a total of $2,450,000,000,000. you add that to the $1.6 trillion of revenue and you've got $4,050,000,000,000 of savings. and then i personally would extend the payroll tax holiday because c.b.o. tells us on the tax side, that's the biggest bang for the buck in giving lift to the economy. it costs you $200 billion. for a net deficit reduction of $3,850,000,000,000. for those who are wondering,

well, what happens to a.m.t. and what happens to the doc fix? we have those in the baseline so they're covered in this proposal. you can correct the alternative minimum tax, you can eliminate the doc fix, be done with it. mr. president, this magnitude of packages is precisely what was called for in the fiscal commission. in the moment-of-truth report, this is what they called for: i think they were right to call for it. i was proud to be part of that effort. i believe this is precisely what we need to do now. so that's the plan. now we need action. we should do it the old-fashioned way. we should make tough decisions, even some that will be unpopular. but it will be the right thing to do, and it will work.

it'll stablize our debt and begin to bring it down. it will provide certainty to our economy. it will unleash, i believe, the $1.7 trillion that are on the balance sheets of our corporations. it will unlock the investment potential that lies all across this country. mr. president, let me just end as i began by simply saying "thank you." thank you to the people of north dakota, thank you to my colleagues, thank you to my staff, and, most of all, thanks to my family, to my wife lucy, to my daughter jessie, to our son ivan and his wife kendra and to our grandson carter. and to all my family members, my cousins who have been with me in

every campaign, i will never forget your support on the one hand your help, and i will always consider serving here the honor of my life. i also want to thank my colleague, senator hoeven, who in the two years that he and i have overlapped has been a good colleague. i have enjoyed working with him very much. i just would close by noting, because many of you know i'm sort of a numbers guy, that i started these remarks in the 12th hour of the 12th day of the 12th month of 2012. i'm sure unanimousologists will make -- i'm sure numerologishs will make much of those remarks. i began this speech in the 12th hour of the 12th day of

the 12th month of 201. -- of 2012. and i leave here ever grateful and i leave here ever grateful last month democrat heidi heitkamp was elected to replace senator conrad. she also served as north dakota's tax commissioner and will be sworn in january and the new congress. democratic senator barbara mikulski came to the floor in wednesday to talk about two of her colleagues who are also retiring, republican olympia snowe of maine and kay bailey hutchison of texas. senator mikulski's remarks are about 30 minutes. ms. mikulski: , i rise during this morning business time to speak, particularly during this time of tension, we're looking at the fiscal cliff, to really use a

few minutes to pay a tribute to two wonderful, outstanding senators who will be leaving us at the end of this term that i have served with. wonderful women named senator olympia snowe of maine and senator kay bailey hutchison of texas. dear friends across the other side of the aisle but though they were on the other side of the aisle there was no great divide between us. we have known each other for many years. a -- a few words i'd like to say about my very dear friend, senator olympia snowe. i served with senator snowe both in the house of representatives and then in the united states senate. wow. what an outstanding senator and congressperson she has been. and i know we will continue to see senator snowe in some type of role in public service, because that's just the kind of

person she is. she is deeply in her d.n.a. a public servant. senator snowe has served her state of maine and our nation so well. she's one of our most respected members of congress, known for her civility, her sensibility, her mastery of the substances of the issue. and i might add, she brings that new england sense of a more frugal government but at the same time shows that you can do it in a compassionate, smart way. i know her as a cherished friend and a dear colleague and a crucial partner on so many issues. as i said, we served in the house and the senate together. we have worked on those issues i talk about, the macro issues and the macaroni and cheese issues. we fought for a better economy, particularly in the area of smaller -- small business, a safer country as we worked on the intelligence committee together, and a more efficient

government. and also we worked together on many issues pertaining to women. in the area of small business, she is currently the ranking member on the small business committee with our other colleague, senator mary landrieu. she knows the backbone that runs the economy is small business. and she also knows it's the backbone of the american economy. i've watched her day in and day out being concerned about her fishermen who are out there working in the cold waters off of georgia's bank for lobsters, to the small shop owner on main street, from the potato fields and lumber yards to l.l. bean, olympia snowe has stood up for them but also for the big issues in terms of jobs in the bass shipyard. in national security, we have worked together to look out for our troops here and to protect our communities from predators over there. she's been steadfast and true. it's a committee that meets

often behind closed doors, but i will tell you, there is a senator that continue to look out for the safety of the american people. one of the areas that i've had the closest work with her is in the area of women's health. you might be interested to know that senator snowe and i received the good housekeeping award for house standing achievement in what we did to advance the cause of finding a cure for breast cancer. now, when i called my sister and told her i was getting a good housekeeper award, she thought it was the funniest thing she'd ever heard. when i told her i was getting it with olympia snowe, she knew it had credibility. i say that because what we did and what we did in working together was in medical research and in clinical trials. you might be interested to know that when i came to the senate, the only other woman senator was senator nancy kassebaum, another

wonderful person from across the aisle. women were not included in the protocols at n.i.h. can you believe that? that famous study, take an aspirin a day, take a heart attack away, was done on 10,000 male medical students. not one woman was there. they regarded including women in research that would present deviant results. we were known as the deviant results. well, pat schroeder, olympia snowe, another republican, connie morella from maryland, we said this couldn't continue to go. so we organized across the dome, across the aisle and we went across the beltway to n.i.h. and we pulled up and demanded answers on why -- scientific answers on why we weren't included. the day we pulled up in our cars on a bipartisan basis, george bush the elder appointed bernadine healy to head n.i.h.

and then working together, again, across the aisle and across the dome, working with senators contain i did and kenne established the office of women's health at n.i.h. the famous hormonal replacement therapy study was done. it resulted in massive change in the way doctors treated women and it has reduced breast cancer rates 15%. so i say to all, when you ask, what did olympia snowe did? she would say, i worked on a bipartisan basis. and because of what she dide e all did working together, men and women, house and senate, we have saved lives of women 1 million at a time. i think that's a pretty terrific accomplishment. and no matter what senator snowe does, she can cherish in her heart that she did that. but while we were busy doing the big picture, she helped me with an individual picture.

we went to the refugee camps of cambodia together, along with the congresswomen. it was when the killing fields were at the highest. we saw the horrible consequences of war. we worked together to field the children. we worked together to feed the children and care for the children. i met a young girl in a refugee camp in the catholic relief feeding camp. working with senator snowe, we brought that little girl to the united states of america. she's alive here today, married and living in an american citizen. so what did olympia snowe do? she saved jobs and she saved lives, and i'm proud to be par part -- work with her. and we're going to miss her. and then there's my good friend, kay bailey hutchison, who's just come to the floor. and i'm glad she's going to be here to hear what i've got to say about her. i hold her in such enormous high esteem. now, senator kay bailey hutchison is known for her

competence, her strong character, and being an outstanding champion for texas, an advocate for women, and a real patriot, dedicated to serving our nation. i, too, know her as a dear friend, someone deeply committed to creating that zone of civility among the women of the senate. when senator hutchison arrived in the senate in 1983, this is -- there were -- there were prickly politics beginning to emerge. she had come from the texas legislature and knew the dynamics of a rum and tumble legislative -- a rough and tumble legislative body. but as we worked together on something called the homemaker ira, we said, why don't we just get together to see if we could create a zone of civility. that's when we brought the women together for those monthly dinners. rules were no staff, no leaks, no memos. we talked about everything from hair-dos to hair-raising. how we could stop the global war against terror and fight the deadly scourge of breast cancer.

we worked together, again across the aisle. in 1992, we also worked to hold these power workshops to make sure that every woman could know how to get started in the senate, and we worked together on that. the other thing that senator kay bailey and i helped establish was that we could disagree without being disagreeable. we, the women of the senate, do not have a caucus because we represent states -- that's what the constitution says is our j job; we're here to represent states -- we also have different philosophies and viewpoints on governance. but we also know we can disagree without being disagreeable. a story i'd like to tell is during the lilly ledbetter fair pay act. senator hutchison and i agreed on absolutely the same goal -- equal pay for equal or comparable work for women. however, we disagreed on the means. we offered -- senator hutchison

had about nine amendments. we duked it out here. we went earring to earring in terms of our debate. and the senate commented what intellectual rigor it had, what a sense of comity and exchanging of ideas. and at the end of the day, we think we came up -- we not only passed the legislation but we did it in a way where everybody could feel proud of the process. why can't we do that every day? gee, i wish we could. then working with senator hutchison -- and this is how we got started -- was on the homemaker ira. this was senator hutchison's idea. she came to me and she said, you know, senator barb, there are stay-at-home moms, they are limited to only $500 to what they can contribute to an ira. and if they have the money and if they have both the will and the wallet, we should give them the same tax opportunities as if

they were working in the marketplace because the work at home should be valued as well. and absolutely, we changed that legislation. and, madam president, i have pending here a legislation to permanently change the name of that homemaker ira to the hutchison ira, because she really did lead the way. i was an able ally. and we made a difference. so i could go through item after item, the way we've worked on breast cancer together, the way we've worked on appropriations. she has -- is my ranking member on commerce, justice and science. we've worked together on the space program. we've worked together to keep our -- our areas safe. from the start, we shared a personal commitment that technology in space could help america remain exceptional. a belief in supporting the research in science leading to

new ideas that would be not only new areas that we would explore but new technologies for new products and new jobs. yes, i visited her dad at mission control and i've been there during the great research that we were able to see being done in that area. she, too, remember, the home of the komen foundation is in texas. but it is not -- senator hutchison was very clear that she wanted to be sure that she, too, was an advocate for women's health. we worked together on mammogram quality standards. madam president, were you aware that in the early days -- and i know sometimes we sound like we built the pyramids together when i tell these stories -- it is both ancient history and a recent reality. if you went into a doctor's office 10, 12 years ago for a mammogram, you might have gotten a chest x-ray and they would have called it a mammogram. it was often given by untrained

technicians, no standards for the equipment, that it would really work the way it's supposed to work, f often uncalibrated and ineffectual. senator hutchison and i worked using sound science, thorough hearings, working with the institute of medicine, f.d.a., the national institutes of standards. and now if you go into your doctor's office for that mammogram, you'll see a certificate from your government that says, this is a place where when your -- that you know that the mammogram -- the technology will work and the people who will be giving it will be trained. you know, once again, early detection and screening, saving lives a million at a time. isn't that fantastic? and again, across the aisle we were able to do that. we also did a book together. she was the leader in helping us get our famous book, "nine and counting." maybe it will be time for another book.

but when the chapter of the history of the senate is written, we want to be sure that the chapter really includes a big statement to the work of senator kay bailey hutchison. you know, again, in this institution, it is the personal relationships built often on policy. i know -- i met -- i went to texas to tour the space program with senator hutchison. that's where we heard about the national space biomedical research institute at baylor. i was there. i met senator hutchison's brother who faced the same blood cancer disease that geraldine ferraro faced. gerry and her brother became fast friends so kay and barb teamed up and again we pushed research at n.i.h. there -- yo you know, cancer kns no party, it knows no zip code, it knows no ideology. but it knows that we need to work together to be able to do it. and on that wonderful day of

friendship, where we learned the best ideas that will come out of our work in the space program to deal with the dreaded cancer words, the kinds of things we study in space will help us be more effective on earth. kay invited me to the houston livestock show and rodeo. now, madam president, i grew up in baltimore -- you have been there many times yourself. you know it is a city known for his row houses, not for its rodeos. kay invited me to come into the rodeo in the astrodome. with i showed up, to her surprise -- well, i showed up, to her surprise. i had little boots on, a cowgirl hat and a vest. she put me in a buckboard and deep in the heart of texas we circled the astrodome together. i was in a buckboard. she was in a pall m palomino neo

me. at the end of the evening, i was there munching on barbecue, affectionately called buckboard barb, and that's the kind of thing -- and i have the pictures to show it. they're locked up. i don't widely distribute them much but it was a heck of an evening. i say that because, again, out of that comes great friendships that also lead to smoothing the way, not paving -- actually, not smoothing the way -- paving the way, where we put our heads together to solve our national problems, a understand t and toy where we get the best ideas from a variety of approaches. and at the end of the way, we feel better but america is better off. i'm really -- i'm pretty emotional actually when i think about olympia and kaye. we've been -- we've been

together a long time. we welcome you and your generation, but for those of us who maybe we didn't build the pyramids, i hope senator hutchison can know there's a latin saying that i learned in a catholic girls school many years ago and i'll spell it for you. [speaking latin] -- we will build a monument more lasting than bronze. when senator hutchison returns to texas to find a new way to serve the people of this country, she knows that here in this institution, along with senator olympia snowe, they built monuments far lasting than any statues or any made of bronze. they have made a difference in the lives much people and they've done it in a way that they can be proud of, that we can all be grateful for. madam president, i yield the floor. mrs. hutchison: madam president? the presiding officer: the is senator from text. mrs. hutchison: madam president, i am so touched by

the comments by my colleague, senator mikulski, about myself and olympia. and i appreciate so much that she has singled us out because senator mikulski is a pioneer. she didn't build the pyramids, i might say, but it was close. she was in the house first and then came to the senate. she is our longest-serving woman senator. and she will probably be the dean of all the senate at some point, because she is a legend. she is a legend in the senate. she is a legend in maryland. she is a legend in our country. and when i think back of the things that we've been able to accomplish -- and i -- it's not that it was just because we were women and we were here. but in a deliberative body, where you have 100 people

representing 50 very different states, it's not that the men aren't -- are against anything that we have teamed up to do. it is that is, because of our experiences that we bring to the table, sometimes it wasn't thought of before -- before nor mikulski and -- before senator mikulski and other women came. and i'll just point out a couple of things and embellish a little bit on what the senator said. when we wrote the book "nine and counting," there were nine women in the senate at the time. and it came from something much bigger. it came from a meeting that senator mikulski brought together of the women of ireland and northern ireland. and it was the catholics and the protestants who were trying to probe the women senators, the

nine of us who were here, about how they could be effective in making peace in northern ireland. and when we started telling our stories to them, to encourage them, that they could make a difference in northern ireland, barbara mikulski and i looked at each other and we said, you know, there's a book here. there's a book about the obstacles that women have faced getting to the united states senate and a book that can encourage our girls and our young women that they can have a part in settling the major issues of our country. and it was from that that we contacted bob barnett, who is the agent of senators and house members who write books and also cab net members and presidents, and we said -- and also cabinet members and presidents. and we said, you know, we'd like to get together and write a book

and h we immediately got togethr and wrote a book. and she got a writer who went to each of us and interviewed us and wrote our stories, which were in our own words, and we got together and decided to give all of the proceeds to the girl scouts of america, which was a common organization that had affected almost every one of the women at the time. girl scouts giving leadership capabilities to the girls in our country and i've been a girl scout, barb had been a girl scout. so our book is still in print, and it has raised tens of thousands -- if not hundreds of thousands -- of dollars for the girl scouts to continue their leadership programs. and it all came from something that we learned about each

other. and i think that the multiple myeloma, which my brother has and which geraldine fe ferraro , was another area in which barbara and i boun bonded, and i bonded with geraldine ferraro, too. she encouraged me a lot. barbara mcskul mikulski, who war friend of geraldine ferraro, and who spoke at her funeral -- and we both went to that funeral -- and we were able to pass legislation that did provide for funding for an educational fund for the research and education for multiple myeloma and we named it "the geraldine fer real

estatfer realfeferregard co" dii only died a year and a half or so ago. her brother is a fighter and he is still going and doing great and now becaus beaver because or research, i'm going to tell you, we're maintaining. and we are letting people live a quality of life, because we teamed up and barbara tells the story -- i'll tell you the other side, the other part of the story about the houston road yeahrodeo,because they still tat buckboard barb. she came to the rodeo from her sort of ethnic background in baltimore and she was such a great sport. and i was riding my horse in the grand entry and barb was in the buckboard. and she was waving and having the best time.

and of course all of us were in our rodeo attire, which was sort of foreign to bar shall be, i -o barb, i have to say. but she was in there with her boots and her big-hair hairdo. and barbara leaned over to me and she said, okay, kay, if we were here monday morning and we went to a chamber of commerce meeting, would these people look like this? i still tell that story in houston, texas, which they love. and, of course, i said, oh, yeah -- which wasn't true. but i loved it. she was the best sport, and they still talk about her. and they did give her a cowboy hat that was to die for. and let me mention one other -- and i know that senator akaka is there, and i won't take much more of your time. we teamed up on single-sex

schools. the senator from maryland mentioned her catholic girls school upbringing. hillary clinton, barbara mikulski, susa susan collins and myself teamed up to assure that every girl in this country hastl board decides to offer it as an option to go to a girls school, and likewise every boy whose school board decides that would be better for the boyce -- in middle challenge especially and high school. because we teamed up after about 15 years of trying, starting with jack danforth from missouri, who started the effort to allow single-sex schools in our public entities in america. when i came here in 1993, we finally passed it with our coalition saying, we know that

this can be better for some girls and some boyce - boys. not all. but it was, i will say to the distinguished presiding officer, it was the young women's leadership academy in harlem, new york, that gave us the courage to say, this can be done, because they fought all the efforts to not allow it, all the lawsuits, they stood up -- and hillary clinton went to visit the young women's leadership school. i took rod paige, the secretary of education, right there to new york, and i said, secretary paige, we can do this for all americans. we can. and hillary and i and barbara and susan said, we're going to, and we did. and it was a great accomplishment. i just want to end by saying that i so appreciate barbara mikulski and john cornyn introducing the bill to name the

homemaker ira for me. it will mean so much to me because i had the experience as a young single woman starting an ira, getting married, and being told, i really couldn't provide for my own retirement security. and i knew that there were so many women who, through divorce or death of a husband -- and they'd gone in and out of the workforce or never been in the outside workforce, and they couldn't save for their own retirement security. and when i went to barbara, i said, barbara, it's a democratic senate. i will make it bill high-incomel

make this bill mikulski-hutchison to get it passed. senator mikulski said, not on your life. it will be hutchison-mikulski, because it is your idea. and she worked just as hard as if it were the reverse. that says more about the senator from maryland than anything i can say. and thank you, barbara, for introducing the bill that would name it for me because i know it will help women long after i leave. and i thank you. and i thank you. elijah cummings questioned if the

players of the nfl be tested for human growth hormone. also, more from the senate chairman committee kent conrad who is retiring in january. coverage from the senate small business committee. starts at 10:00 a.m. eastern on c-span3. >> we know that the main event

from our point of view, we have written them. what i want to do is show from a different angle, from the ground up, what did it feel like to be one of the people who was subjected to this system, and how do people make choices in that system, and how did they react and behave. it is interesting that one of the things that has happened since 1989 is the reason that we used to call eastern europe, it has become very differentiated. this country no longer had much in common with one another, except for the memory of communist occupation. more with anne applebaum on life in soviet east germany, poland, and hungary. the end of world war ii in 1956. from historical narrative, iron curtain, on c-span's "q&a". >> ben bernanke announced monetary actions that the federal reserve will try to take sustained economic recovery,

including keeping interest rates low. mr. ben bernanke spoke to leaders after the market meeting. this is one hour and 15 minutes. >> the economy continues to expand at a moderate pace. unfortunately, however, unemployment remains high. about 5 million people, more than 40% of the unemployed have been unemployed for six months or more. and millions more have been able to find only part-time employment or have stopped working entirely. the conditions now prevailing in the job market represent an enormous waste of human and economic potential. the return to broad-based prosperity will require steady improvement in the job market, which requires longer economic growth. meanwhile, apart from temporary fluctuations in large swings in energy prices, inflation has remained tame.

2% objective over the long-term. against an economic backdrop that includes high unemployment and subdued inflation, we will maintain highly accommodative policy. today, the committee took several steps. first, it decided to continue its purchases of agency mortgage-backed securities, initiated at the september meeting at peace about $40 billion per month. second, the committee decided to purchase longer-term securities, at least a $45 billion per month. after its current program with the average maturity holdings at the end of the year. continuing asset purchases, the committee seeks to maintain downward pressure on long-term interest rates in the key financial conditions accommodated. there it is close to 2%

objective. finally, the committee modified guidance about future policy to provide more information to the public about how it will react to a economic conditions. i will return to this conversation to discuss asset purchases. although the committee's announcement today specify the program did not provide dates in which it will be modified. the federal government will rely on incoming information in two respects. first, we continue asset purchases until we see a central improvement in the context of price stability to we see an improvement in the labor market. the committee will be evaluating a range of indicators, including the unemployment rate, payroll employment, hours worked, and the labor force participation among others. because increases in demand and production are only precursors

to improvement of labor market conditions, and we will be looking at economic activity more broadly. second, the committee will be monitoring economic and financial developments to assess both the efficacy and possible drawbacks of the asset purchase program. the federal reserve's asset purchases over the past few years two years have provided important support to the economy. for example, by helping to keep mortgage rates historically low. the committee expects the policy to continue to be affected in the costs and risks to remain manageable. we will be regularly updating those assessments. future evidence suggests that the program evans has declined and risks become apparent as the balance sheet rose, and we will modify the ramp is gross. also, the committee intends to be flexible in response to information about perceived

benefits and costs about the program. unlike the quantitative criteria associated with the guidance about the federal funds rate, which i will discuss in a moment, the criteria committee will use the extended access purchase program, which is politics. it is tied to our seeing substantial improvement in that outlook of the labor market. because we expect to learn more over time about asset purchases in the current economic context, we believe that a qualitative guidance is more appropriate at this time. in today's statement, the committee also asked to clarify about the future economic developments. specifically, the committee anticipates that exceptionally low levels for federal funds are likely to be wanted at least as long as the unemployment rate remains above 2.5%.

inflation over the period of one and two years ahead, above the longer run goal and longer-term inflation continues to be well anchored. this was expressed in terms of the day. for example, in the statements following in the september and october meeting, the committee indicated that exceptional doubles are likely to be warranted through 2015. we promote a strong economic recovery in the context of price stability. a strategy that we believe will help support household and business confidence and spending. by tying this to economic conditions, this formulation of the policy guidance should make monetary policy more transparent and predictable to the public.

the change in the form of this guidance does not imply any change in the committee's expectation about the likely future path of the federal funds rate since the october meeting. in particular, the committee expects the threshold will not be reached at 42015 and projects that inflation will remain close to 2% over that period. let me emphasize the 6.5% threshold should not be interpreted as the committee's longer-term objective for unemployment. indeed, in the economic projects and cemented with today's meeting, the disciplines are up 5.2 or 5.0%.

because changes in monetary policy affect the economy with a lag. waiting until maximum limit is achieved could lead to an undesirable shooting of output. the committee anticipates that policy under this guidance will be fully consistent with this 2% objective over the longer term. although the modified guidance should provide greater clarity about the committee expects to respond to incoming data, and by no means put monetary policy on autopilot. in this regard, let me make several points. first, the statement notes that the committee uses current policy is likely to be

appropriate, at least until the specified thresholds are met. reaching one of those thresholds, however, will not trigger immediate reduction in policy commendation. for example, if unemployment were to decline to slightly below 6.5% at a time when inflation and inflation expectations were subdued and projected to remain so, the committee might judge an immediate increase of the federal funds rate to be inappropriate. ultimately, deciding when and where in regards to policy accommodation, we will follow a balanced approach to deviate mitigations in the 2% goal and deviations of employment from the estimated maximum level. second, the committee recognizes the state of the labor market. we will consider changes in the unemployment rate within the broader context of labor market conditions.

the committee will also take into account with increases of employment as opposed to increases in the number of discouraged workers and falling labor force participation. it appears that the employment rate. sustainable. there, the committee explained that threshold between one and two years ahead rather than in terms of current inflation. the committee took this approach may clear that it intends to look through transitory fluctuations in inflation. including those produced by short-term variations in the prices of internationally traded commodity and to focus on the underlying inflation trends. in making the collective judgment about the underlying inflation trends from the committee will consider a variety of indicators, including measures such as core inflation and abuse of outside forecasters and the predictions also paying

closer attention to make sure that those intentions are well anchored. finally, the committee will continue to monitor a wide range of information and financial developments to ensure that this is done in a way that is consistent with a mandate. it is worth noting that the asset purchases in the federal fund rate guidance is somewhat different. the purpose of the rate guidance as to provide information about the future circumstances under which the committee would contemplate reducing accommodations. i would emphasize that a decision by the committee to end asset purchases, whenever that point is reached would not be a tighter policy. the policy stands would remain

highly supportive of growth. only at some later point with the committee remove accommodations for rate increases. moreover, as i discussed today, the decisions to modify the asset purchase program are tied to different criteria. in conclusion, the actions today are part of our ongoing effort to support economic recovery and job creation. while maintaining price stability. as i have often stressed, monetary policy has its limits. only the private and public sectors working together can get the u.s. economy back on track. in particular, it will be critical that fiscal policymakers come together soon to achieve fiscal sustainability without adopting policies that could derail the ongoing recovery. thank you. i'm happy to answer your questions.

sir, i am from cnbc. why are there different targets for cutie and the funds rate. what does that achieve? , what good is a target, and you have to point out in the statement, that it is not different from back in october, you have to keep doing that to make it clear we met angus. then you have another paragraph after that that says that it's not just targeting something else. what good are these targets and then to say that they are not really targets? >> verse, as i said, the asset purchases and the rate increases , they are about strengthening growth and job

creation and the increases in the federal funds rate, when it ultimately occur, they are about reducing accommodations. two very different objectives. second, the asset purchases are a -- -- but they have independent unintended consequences and we will see what else is happening to the economy. in the opening remarks, we decided to make the criteria qualitative at this time. we have a number of different things that we need to look at as we go forward. rate increases, by contrast, we understand the relationship

between those rate increases and the state of the economy. and so we have had more specific guidance and not respect. the transition today, we wanted to make clear that the change in guidance did not happen to be the case but it doesn't change our mid-2015 expectations. going forward, we will drop the date and the light upon the conditionality, and that has a very important advantage. that is good news comes in that the economy is stronger or weaker, financial markets and the public will be able to adjust their expectations for one policy tightening will occur without the committee having to go through a process of changing in a non-transparent way. i think that that is beneficial. does that cover your question?

[inaudible conversations] >> mr. chairman, what prompted the committee to make the decision at this particular time to specify targets? also, by taking an unemployment rate that is quite low compared to currently, does that shift the balance of priorities in terms of dual mandates a map more in the direction of reducing unemployment rather than inflationary pressures. >> that's a very good question. we took this change today after a good bit of discussion. we had a substantial discussion of the threshold approach at our last meeting. and we felt that it was ready to go, ready to put out.

while there are different views and aspects of the threshold approach, there was a lot of agreement that having a more explicit connection between rate policy in the state of the economy, it was more transparent and hopeful to markets and to the public than the other guidance. therefore, there is a general view at some point there is the ability to switch to that kind of guidance. we do hope it will be more helpful and give our markets more information about how we shall respond going forward. now, it is not a change in the relative balance, by no means. first of all, with respect to inflation, we remain committed to our 2% objective. we expect the forecast, as you can see, inflation will actually remain, despite this threshold

of 2.5, that inflation will actually remain at or below 2% going forward. finally, the threshold that we have put out, they are entirely consistent with our view is upon while keeping inflation close to target. i think that both sides of the many are well served. there is no real change in policy. what it is is an attempt to clarify the relationship between policy and economic conditions. >> could i ask that the economic projections, they are all the more important now. now that you have specified these targets. it's a difficult book for these projections now, given the uncertainty over the fiscal cliff?

how plastic are these? >> are you talking about the stc productions? >> yes. >> well, clearly the fiscal cliff is having effects on the economy. even though we have not reached the point of the fiscal cliff potentially kicking in. it is already affecting business investment and hiring decisions. we saw what happened to everything in regards to the fiscal cliff, and really this is a major risk factor and a major source of uncertainty about the economy going forward. i would suspect that the participants don't make this explicit, but what they are assuming in their projections is that the fiscal cliff gets resolved in some intermediate way, whereby there is still some

fiscal drag, but not as much as i buy the fiscal cliff. you're absolutely right that there's a lot of uncertainty right now. it is the fiscal cliff situation, and it turns out to be resolved in a way that is different from our expectations. i'm sure that you will see changes in the forecast been a [inaudible question] >> thank you, mr. chairman. in regards ramping up additional easing, you will now be adding more, also, you know, we talked about maintaining until we see substantial improvement and he said that you want to take a

different approach. but you also have 6.5% inflation as well. could you talk about what sort of evidence do you have seen that will slow the pace of this? >> the first part of your question was is this an additional stimulus? >> welcome i think this is a continuation of what we said in september. as you recall, we express dissatisfaction with progress in the labor market and we began the $40 million per month of the purchases and we said that unless we saw substantial improvement, but we would undertake additional asset purchases or other actions. and that is what we have done today is simply follow through, as we said we would do in september. i don't think that we have, relative to last month -- i don't think we have significantly added to accommodations. the reason, at least in my view,

and i think many of my colleagues as well, what matters primarily is the mix of assets what is important is the fact is that we are acquiring social security is end up taking this out of the market, you know, forcing investors into other closely related assets. that is where the stimulus comes from. not so much the size of the balance sheet per se. in my judgment, the amount of stimulus is more or less the same. it has just been continued to follow through what we saw in september. in terms of criteria, again, what we have done is announced an initial amount of 85 billion per month of purchases. as new information comes in, if the economy outlook gets noticeably stronger, for example, we would begin to ramp

down the level of purchases. but again, the problem with giving a specific number, it is that there are multiple criteria to make this decision, and we will be looking at the labor market, which is very important. we will also be looking at other factors that may be affecting the outlook in the economy. for example, i hope it won't happen, but if the fiscal cliff occurs, as i've said many times, i don't think that the federal reserve has the tools to offset that event. in i.t., with we have expectations about what we can accomplish. likewise, as i said, we will be looking at the efficacy and cost of the program. if we find and we find that it's not working, the various costs are emerging that we had not anticipated, that will help us take these into account. we, ourselves, we don't know precisely what will define this

improvement. obviously, as long as costs and other concerns do not emerge, we will be looking forward, you know, something that is substantial in terms of a better job market. >> [inaudible question] >> hello, mr. chairman, if i can follow up with your last response there. given the fiscal cliff, is it possible that if the policymakers were not to agree to some sort of deal by the end of this year, and we were to go over the fiscal cliff come in the size of these asset purchases could grow in response to that. more specifically, you coined the phrase fiscal cliff. i want to get your take on whether you feel it is the most appropriate language to describe what would happen in the beginning of the year. there are some americans who may be alarmed by the language. some economists say it is. do you feel it is appropriate

about the fiscal contraction of it, there is no deal. >> well, the first part of your question is -- if the economy actually ran off the fiscal cliff, our assessment, the outside forecasters all think about a very significant adverse effects on the economy and the unemployment rates. on the margin, we would try to do will be good. we would perhaps increase a bit. i would like to again be clear that we cannot offset the full impact of the fiscal cliff. it is just too big, given the tools we have available and the limitations on our policy toolkit at this point. on terms of terminology, people have different preferences about what they want to call things. i think it is a sensible term because i think the fiscal policy providing support to the economy summit if it becomes very contractionary.

i don't buy the idea that a short-term% off the fiscal cliff would be not costly. i think it would be costly. we are rdc and costs. why is it that consumer confidence drops significantly. why is it that the markets are volatile? wines business investment among the weakest levels during the recovery. i think all of these things come in, to some extent, could be traced to be anticipation and concern about the fiscal cliff. and i think that's, you know, we don't know exactly what would happen. i think there is certainly a risk that it could be serious. therefore, i think it is very important in the most helpful thing that i think congress can do right now is to find a resolution that on the one hand

achieves fiscal sustainability, which is absolutely critical for healthy economy, but also avoids derailing the recovery, which is currently in process donaldson from "the wall street journal." mr. chairman, the threshold that you announced today, the committee's assessment of this unemployment rate is 6% of the longer run equilibrium funds rate, it is about a percent. according to these protections. it suggests that when the fed does start raising interest rates down the road, it might have to move quickly to get to some funds rate equilibrium. is that specifically -- is that the not the case. generally, can we talk about the

framework that you said today in the exit strategy that you have laid out some time ago and whether that is evolving or changing. >> well, that is a good question. first of all, we do not have a precise estimate of the long-run sustainable unemployment rate. the estimates that were provided in the summary of economic projections today, as has been the case or the while, it is 5.2 to six-point 0%. it could be less than that. so it gives us some time. my anticipation is that the removal of the accommodation after the takeoff point, wherever that occurs, it would be relatively gradual. i don't think we are looking at an increase, of course, that depends on where inflation is and other conditions. it is the path that we are facing these numbers with and

basing the numbers on. first of all, as you anticipated, it assumes an increase in the funds rate first occurring sometime after unemployment goes below 6.5%. as we said in a her statement, we will take a balanced approach. once we get to that point, we may or may not raise rates at that point. we will look at the situation. but assuming that inflation remains well controlled, which i anticipate, i think that the rate of increase would be moderate. it is consistent with her statement today because the exit strategy was about how we would normalize the balance sheet over

time. there is some increase in the size of our balance sheet, and that is consistent with the general sequence that we have in the minutes of a year and a half ago. that being said, if the balance sheet is enough, we may have to reconsider the case or timing of that. i don't see any changes that would radically change the normalization or the time to exit. >> hello, it sounds like as far as the fiscal consolidation goes, it sounds like you would support the recovery -- of people in cars power can do that in the next two weeks, think this is preferable going over the fiscal cliff, on the monetary policy actions today, can you give us some color on how you get the threshold of what they were? and what the alternatives were,

and various alternatives for similar policies? >> sure. i am hoping that congress will do the right thing on the fiscal cliff. there is a problem with kicking the can down the road. it might avoid some of the short-term impact on the recovery, but it could create concerns about our longer-term fiscal situation, and i do not want to see that. it is in the best interest of the economy. part one is to modify the fiscal policy that doesn't create enormous headwinds for the recovery in the near term. virtue is to lease take important steps. he is achieving a framework, at least, by which before the negotiation, the congress and administration can achieve a

sustainable pass for fiscal policy. both of these parts are very important. i don't think we can consider these negotiations must both of them happen. >> i think they are equally important. on the threshold numbers, these numbers are based upon a schedule analysis done by staff here and at into the reserve banks, trying to assess optimal policy were the best policy we can come up with, what would be the interest-rate and how it looked like him and how to be connected with changes in unemployment and inflation. will we find is that the best interest-rate path, the best we can determine it based on our models, which are obviously imperfect, it has unemployment

drops below 6.5%, and it projects percentage point above the 2.5% goal. it is the kind of protection against any problem of price stability. our projections are actual forecasts that suggest that inflation will not go there. it will stay around 2%, which will be consistent with the longer-term objective. >> important new information about the structure of the economy. it is possible, but i consider it relatively unlikely. this is one of the -- this is one of the advantages. is information that the economy is stronger than we expected, it doesn't necessarily require a change in the threshold. because backdate adjustment can be made by markets by looking at their own forecast for one

unemployment will cross the mind and the behavior of inflation. >> i am from cnn. when you appeared on 60 minutes on one of the things that happen was that you visited your own hometown. you talked a little bit about how the economy has affected people that you grew up with. how it had affected the people down there. there are a lot of regular people like that who are out in the countryside wondering what really happens to them if we do go over the fiscal cliff. taxes go up and spending goes down. do they need to look for a recession. our employers really going to cut back on the employment, do you think? what do people out there really need to worry about and prepare for? >> especially when it comes to

going over the fiscal cliff. the folks and washington. >> the part of south carolina that has been economically challenged for a while and remain so, certain parts have developed pretty strongly. but the part where i come from, mostly agricultural, they have a high foreclosure rate and people are having a very hard time. i visited there since i became chairman. the part of the reason that we are engaging in these policies is to create a strong economy and more jobs so that folks across the country, including places like the one where i grew up, they would have more opportunity to have a better life for themselves. that is extremely important, and i think it's very important that we not just look at the numbers,

it's easy to look at the unemployment rate and say it is one 10th or 210 and every 10th means that every kind of person is represented. it is important to keep in mind the reality of unemployment and wage growth and et cetera. we always try to do that. it is always a delicate balance and you don't want to scare people. and actually believe that congress will come up with a solution, and i certainly hope that they will. as the fed has pointed out, the fiscal cliff was allowed to occur, it could have a very negative effect on hiring jobs, wages, economic activity, and of

course the consequences will be felt by everyone. what areas where i grew up, they are relatively weak and no doubt feel the greater crime. it is exceptionally urgent that congress and the administration come to sensible agreement. >> i'm not going to ask you whether we are in a bond bubble. obviously the new guidance that you have given in the statement is going to give a lot more clues to people about when they might start lining up their conversation about what they own. were concerns about information and bond prices and things happening in a big hurry, in terms of some sort of bubble

popping, was that a consideration in adding this transparency? >> i would not say it was an important motivation. i think transparency adds a lot of value. but it is a fact that this greater clarity will help markets better predict how bond yields will behave. as we go forward, if the economy continues to strengthen as we hope, we would expect longer-term bond yields to begin to rise. the more information that we provide through the markets about the conditionality under which this is, the better information you will have more smoother adjustments. i think that is a positive aspect of this communication. i would not say if the major reason. the major reason is to give the markets and the public more

transparency about what is determining our policy. that is one potential advantage. >> [inaudible question] .. >> so, that kind of optimal policy path that vice chairman yellen showed is indicative of

the kind of analysis for a brady of difference different scenarios and different assumptions about models and so on but the general character of that interest-rate path, i.e. that is stays low until unemployment is in the vicinity of 6.5 or a little lower and then rises relatively slowly which goes back to the question that was asked earlier, that it doesn't involve a rapid removal of accommodation after that point is reached. that is consistent with that kind of analysis and that type of analysis that was not the only thing we looked at. it was informative in our discussion. you will note also in that kind of policy path of the type that she discussed that inflation stays essentially add to or very close to two. in terms of the inflation forecast, what the committee will do on a regular basis is

include in its statement, its views of where inflation is likely to be a year from now. for example currently we say that we expect inflation to run after a below the projection longer-term. the intellectual exercise we will be doing is asking ourselves if we maintain low rates along the lines suggested by this policy would we expect inflation to cross the a threshold or reach that level? now it's very important that the public, the media, the markets find our projections credible obviously and so for that reason you know, we will be referring extensively to publicly available information such as various measures of inflation and i mention this in some of my opening remarks, outside workouts, the break events from inflation protected lawns etc.,

so if our outlook deviates in any sense in a significant way with sort of what all these things are saying, at a minimum it would be incumbent on me and the rest of us to explain that but my expectation is that our projections will be broadly consistent with the public views, public information so i think we can manage the credibility issue but again, just to be clear, the projection that matters for our determination is the one that the committee collectively comes up with. speier have articulated more clearly than ever your commitment to reduce unemployment but you have also said you are not actually doing anything more to achieve that goal. you still expect to be three years away that you are disappointed with the progress and the inflation is not the limiting factor. what is the limiting factor? why is the fed not announcing

additional measures to reduce unemployment and what would it take you to get them? >> well, we took -- the question was whether this was something new relative to september. i think september was the date where we did do a substantial increase in accommodation. at that point we announced our dissatisfaction with the state of the labor market and the outlook for jobs and as i said we would take further action if the outlook did not improve. what we have done today is really just following through with what we said so i would say looking at it from a perspective of september, that we have in fact taken significant additional action to provide support for the recovery for job creation. the reason, one of the consideration so as i talk about it, given that we are now in the role of unconventional policy that has both uncertain costs

and uncertain efficacy or uncertain benefits, you know that creates a more somewhat more complicated policy decision than the old style of just changing the federal funds rate. though there are concerns that i talked about in these briefings before, that is the balance sheet would be large with potential risk of instability and the committee takes these risks very seriously. they impose a certain cost on policy that doesn't exist when you are dealing with only with the federal funds rate so what we are trying to do here is balance the potential benefits in terms of a lower unemployment and inflation and target against the reality that as the balance sheet gets bigger, there is

greater costs that might be associated with that and that has to be taken into account. >> how do you incorporate the action taken -- >> given those action it would be three years until you receive your goal. is the message to people who are unemployed basically we are doing everything we can and the conclusion that given that a specter this is the most we can expect? >> first of all the projections you are looking at are based on each individual. this is not committee collective projection. what they are his 19 separate participants making their own projection based on their own views of optimal policy so for example it includes those folks who think we shouldn't be doing any more purchases and their forecasts are included in there as well so it's not exact and an apples-to-apples comparison. but it is true that if we could

wave a magic wand and get unemployment down to 5% tomorrow obviously be would do that but there are constraints in terms of the dynamics of the economy, in terms of the power of these tools and in terms of the fact that we need to take into account the possibility of other costs and risks that might be associated with a large expansion of our balance sheet. >> following up on that last question, how helpful would it be to see part of the fiscal crew -- cliff resolution some near-term stimulus. how helpful do you think that would need and i will asked my follow-up now. whatever happened to your southern accent? >> on the second one i would like to think i am bilingual.

when i go home sometimes it comes out pretty strongly that i won't try to do that here. so i tried to be careful as you know, not to give views on specific tax and spending programs. i think of course obviously those are the profits of the administration in congress. the attitude i have taken has been that at a minimum congress should try to do no harm, that they should try to avoid policies that significantly slow or derail the recovery at this point so i think that is the critical thing along with the long-term objective of achieving a sustainable fiscal path. now, given that basic recommendation, congress can consider variations. for example if they believe they can achieve a strong, credible

future path for fiscal policy that would give them potentially some to do something a little bit more expansionary in the short-term. those are judgments that congress has to make about whether they can simultaneously continue support the fiscal policy in the short term while maintaining the credibility that in fact they will be addressing our structural deficit problems in the longer-term and that is i think really a question for them and for their staff. >> christina peterson. looking over the past year or several years, how would you evaluate the fed's accuracy in making economic forecasts and how does that affect the ability to make monetary policy decisions? >> well, i think it's fair to say that we have overestimated

the pace of growth, total output growth, gdp growth, from the beginning of the recovery and we therefore had to continue to scale down our estimates of output growth. interestingly, at the same time we have been more accurate, not perfectly accurate by any means but somewhat more accurate in forecasting unemployment. how do you reconcile those two things? i talked about that at the economic club recently before thanksgiving and i think the reconciliation is that when we are learning -- what we are learning at least temporarily the financial crisis they have reduced somewhat the underlying potential for the growth rate in the u.s. economy and its interfered with business creation and with technological advances and so on. and that can account for at

least part of the somewhat slower growth. at the same time though of course what monetary policy influences is not potential growth, not the underlying scriptural bar of -- structural growth. many other kinds of policies affect that monetary policy affects primarily is the state of the business cycle, the amount of excess unemployment for the recessions in the economy and there i think we have also perhaps underestimated a bit the recession but we have been much closer there and i think therefore that we have been able to address that somewhat more effectively with quite accommodative policies. that being said of course we have over time as we have seen disappointments in growth and job creation, we have obviously, as we did in september, have

added accommodations and we have continued to reassess the outlook. i think it's only fair to say that economic forecasting beyond its support is a very difficult and what we basically are trying to do is create a plausible scenario which we think is likely and base policy on that but be prepared to adjust as information comes in and the outlook changes. inevitably it will. >> thank you mr. chairman. economists have long believed that banks cannot affect the employment rate in the long run and that is what we have seen a move towards banks seeking -- can you explain if the fed i tying in policy soaks lucidly to the unemployment threshold whether it's inconsistent are consistent with their long-standing view and if it's

consistent how is it superior to having inflation only and would it be possible if the fed had only a mandate for inflation? >> it's entirely consistent with your view with the point that you made, so let me just reiterate it. as we stated in fact in our january set of principles, the central bank cannot control unemployment in the long run. i would add a caveat or a little bit of the caveat here which is that very extended periods of unemployment can interfere with the workings of the labor market, and so if the fed were not to address a large unemployment problem for a long time, and might in fact have influence on the long-term unemployment rate that is a general rule i think this is the right baseline. the long-term unemployment rate

is determined by a range of structural features in the economy and a range of economic policies and not a monetary policy. so that being said, what our 6.5% threshold is like i said my opening remarks, it is not a target that it is the guidepost in terms of when the weakening of the reduction of accommodation could begin. it could be later than that but at least by that time. no earlier than that time. so it is really more like a reaction function or a rule if you will and i'm ready to get the phonecall from john taylor. it is not a taylor rule but it has the same feature that relates policy to observables in

the economy such as unemployment and inflation. so what is basically doing is saying how our policies will evolve over time as our economy. it has no implication that it can affect the long run unemployment rate which we believe is lower than 6.5%. we think it's somewhere between five and six according to our projections. we are a dual mandate central bank and i think that providing information on both sides is more healthful. so, i understand your point but i think providing information on unemployment and inflation is -- gives more information to the markets and the public and allows us to to defer how our policy of falls. [inaudible] >> so long as the inflation condition is met, that is

correct. >> mr. chairman wyatt andrews, cbs news. i would like to hear a little bit more about why you made this announcement today specific way tying federal funds and your policy to 6.5% number. i'm sure you have some sort of theory about what you hope changes in the economy as a result of this announcement. if so, what is it? >> well, we think it's a better form of an indication. we think by using the threshold which ties rates to economic conditions, we are more transparent about what determines our policy in the future. that date-based guidance has served its purpose but it has a problem that, whenever economic outlook changed, the committee was faced with a the question of whether we should change the date-based guidance and we did change it a couple of times but it was a non-transparent process.

nobody understood exactly why we made a particular change because we were not providing any fund all information about how our policies link to the underlying outlook so i believe certainly that this approach is superior. i'm not saying it's the best possible approach and their other things we can do in the future and are always looking at ways to correct medication but i think it's more transparent and will allow the markets to respond quickly and promptly to changes in the outlook by adjusting windbreak rate increases will begin and therefore it will act to some extent like an economic stabilizer and that leads markets to think increased rates in the future will tend to lower longer-term rates and that will tend to be supportive of the economy so that has an automatic stabilizer effect to offset shock. as i said we discussed it quite extensively at the last meeting and so frankly, given that it's

a relatively complex change, it seemed like it would be a good idea to do it at a meeting where there is a press conference. so, we decided we were ready to go, why not meet the change earlier and get the benefit earlier? >> has a quick follow up, did you see a level of uncertainty in the business community that you hoped to solve by this announcement? >> well i think that the expectations of the business community and the federal market have to be pretty well aligned. if you look at the financial market indicators of the future federal funds rate path that's pretty consistent with 2015 date taste guidance we have been providing. i'm not saying there was a major inconsistency between what the business community was expecting

and what the markets were expecting and what we were expecting so that wasn't really an issue. the problem was that, looking forward that what happens if there is a significant change either for better or for worse in the outlook? under the date-based guidance that requires the committee to determine what the date is and to make that change in a non-transparent way but under this threshold-based guidance, the market and the business community can make that cap relation on their own and adjust that estimate to win the rate will begin to increase based only on their own forecast. i would have to wait for the federal market committee to give them a date. we just think it's a better approach. 's been mr. chairman josh from "bloomberg news." by mid-2015 the coverage will be

nearly 16 years old and the average post-war recovery has been a little under 6.5. d. expect by mid-2015 the rate will be a 0% of the balance sheet is potentially four chilean dollars. of the business cycle runs out of steam and you're still a 0% interest rate does the fed no longer have a forceful response than that situation? >> well, the fed will always -- we have an abated quite a bit in the last two years and it's always possible we can find new ways to provide support for the economy but it certainly drew, there is no doubt that with interest rates near zero and with the balance sheet already large, that stability provides additional accommodation and it's not unlimited and that is just a reality. that actually is an argument for being a little more aggressive now. it's a really good obj to get the economy moving, to get

the moment some. that protects the economy against unanticipated shocks that might occur and gets us off the zero balance earlier. so exactly for those reasons the kind of risks that arise when policy interest rates are close to zero and the greater difficulty of providing additional policy support, think that's an argument for being somewhat more proactive now when we still have the ability to do that and to try to get the economy back to a healthy condition. >> hi chairman. my question pertains to the volcker rule. regulators earlier this year have been cautiously optimistic that they would finalize the rule by the end of the year however that seems a bit unlikely this point and now she know lawmakers are calling for a two year implementation on the road. given the fact that is such a

lengthy process, can you tell us where things stand at this point? how much closer are we to a final rule? have they been able to work out their differences and and a if you make him a prediction on when they might actually see a rule? >> we have made quite a bit of progress on this complex rule as you know and i think i recall we have it 18,000 comments or something like that so it's been a lot to look at. there are a lot of concerns that arose either from foreign commenters about the effects on their law and markets etc. so there's a lot of work to do. i think there is quite a bit of agreement. i would say quite a bit of agreement on key points among the regulators at this juncture and, of course his congress gives us some other instruction label to that but it's our intent to get this done early in 2013.

>> peter barnes, fox business mr. chairman. censure last press conference with those we have had an election. one of the candidates of that election governor romney said he would not reappoint you to a third term as chairman. president obama did not weigh in on the issue but he did win re-election. if the president were to call you and say, ben your country needs your continued stewardship of the federal reserve, we need you to stay and finish the job to see this through. would you consider at? would you do it and by chance have you had any conversations to that effect with the president or anyone on his teen? thank you. >> to answer the last part, no i haven't had any conversations. i think the president has had quite a few issues that he's been thinking about the fiscal cliff and many other appointments and so on. from my own perspective i really

don't have anything to add to the last press conference. i am very much in gauge and as difficult this difficult issue we are discussing today and i've not been spending time thinking about my own future so i don't really have anything to add there. 's been mr. chairman, taking the volcker rule into effect there is a debate with the boehner plan about the chained cpi and as an economist is there logic and going to that? do think it's a move that should be done separate from the politics of it and again the labor market come he talked about the importance of the 6.5% threshold but the broader conditions and the nemesis -- in your mind what is happening

in the job market? are we creating jobs? is that why it's coming down or is it because people, the degree of discouraged workers? what is your sense on how quickly it has fallen because of new employment? >> on the first question, chained cpi versus the fixed-rate cpi, the technical issue, chained cpi is technically better according to most economists because it allows for changes in goods and services that people actually consume more effectively. however more appropriate for social security indexing or not i think that is a political decision. i suppose a rejoinder would be that neither the cpi nor the chained cpi may be a good measure of the cost of living for social security recipients so those are the kinds of questions that congress is going

to have to deal with [inaudible] >> yes, sorry. you see the comparison by looking for example at the household survey which gives estimates of how many people are added to the labor force and how many people leave the labor force and it's true that indeed all of it but over the recovery, unemployment has come from declines in participation rates as people are leaving the labor force. some of that participation appears to be due to longer-run

factors, aging and changing patterns of work among women, so the things were probably not directly related to the recession for example. but he on that trend, the labor force participation and the ratio of deployment -- make employment to population which presumably is linked to discouragement about the state of the labor force. so that will be part of the issue. that being said obviously there has been job creation and you can see that in the household survey or in the payroll establish survey. so, there is no doubt that the labor market is considerably better today than it was two years ago. there isn't any question about that but it's although -- also the case that many labor markets

remain quite weak ranging from long-term unemployed to people who have part-time work who would like full-time work, wage growth. obviously it's very weak and i could go on. so, it may be that thebor market is even a bit weaker than the current unemployment rate suggests but i think that it is nonetheless the case that there has been improvement since the trough a couple of years ago. 's been mr. chairman, catherine honda from the "national journal." how concerned are you that markets will have to tank in order to get lawmakers to reach a deal on the fiscal but then would he make of the recent complacency? is there a washington disconnect? >> interesting question. i certainly hope that markets won't have to tank. we want to have confidence in

the markets and businesses and households as well and this way fiscal policymakers can achieve that by coming to a solution as quickly as possible. markets have obviously responded to some extent up and down and you can see day-to-day how they respond to the news about negotiations. but on the other hand it's also true when you look at the experience, the informative experience in august of 2011 that both confidence and markets remain pretty sanguine pretty close to the point where there was a chance the debt limit would not be raised. and then, of course, there was a

sharp shock particularly in confidence about the time of the final debate. so it's not unusual to see markets being complacent. of course the market point of view is a risk in both directions and obviously things can go badly. if it went well it would be good news and maybe it's an average of those two possibilities but again to reiterate, i don't think any policymaker including the fed should be responding to markets. what we should be doing is making policy based on the fundamentals and doing what is best for the economy and i hope fiscal policies will follow that injunction as well.

>> mr. chairman, steve beckner of market news international. with the federal government borrowing roughly $1 trillion a year and now with the fed on pace to buy roughly a trillion dollars a year in bonds, are you concerned about a public and possibly global perception that is accommodating not just growth but accommodating better role borrowing needs and are you concerned about what this might do to the credibility of the fed in the credibility of u.s. finances in general and the credibility of the dollar and in the currency? >> first of all just a couple of facts. we are buying treasuries and mortgage-backed securities, so

we we are buying considerably less than the treasury is issuing and moreover, the share of outstanding treasury that the federal reserve owns is not all that different from what it was before the crisis. while our holdings have increased so has obviously the stock of treasuries in public hands so it's not quite evident that there is such a radical shift there. we have been increasing our balance sheet now for some time and we have been very clear that this is a temporary measure and it's a way to provide additional accommodation to an economy which need support. we have been making it clear that we will normalize the balance sheet and reduce the size of our holdings and whether by letting them run off for by selling assets in the future, so this is again only a temporary

step. it would be quite a different matter if we were buying the assets and holding them indefinitely. that would be modernization. we are not doing that and we are very clear about our intentions and i think up until now, it seems our credibility has been quite good. there are not any signs either of current inflation or no strong evidence that there are any increases in expect patience for that matter. looking at surveys and economic forecasts and so on, so this is one of the things that we have to look at. remember i talked earlier about the potential cost of our balance sheet. we want to be sure that there is no misunderstanding, that there is no effect on inflation expectations. that is one of the things we have to look at, but to this point, there really is no evidence that people are taking it that way and i guess it's

worth pointing out and of course we are focused on united states here but we are not the only central bank that is increase the size of its balance sheet. the japanese and the europeans and the british have all done the same and very much to the same extent in terms of a fraction of gdp. i think the market players in the public understand that this is part of a collective need, a need to provide additional accommodation to weak economies and not an accommodation of fiscal policy. >> a last but not least, greg from market watch. there seems to be growing evidence that some of the mbs purchases, the impact of the mbs purchases, the banks are holding onto some of the gains of not passing them on to the

borrowers. is there anything you can do about that and are you upset about that? >> the question is, just to restate your question is about the spread between the mortgage rates that the public pays and the yields to mortgage-backed securities that banks may hold and the question is, is that spread widening so that the whole benefit of the reduction is not being passed through. that is the question. i just had to make sure everybody heard it. [laughter] our analysis suggests that it takes time. two points. the first is that while we don't expect 100% pass through yields to mortgage rates are empirical and theoretical analysis, we have had quite a

bit of work done on this issue, suggested over time the great majority of the decline in mbs yields does get passed through to mortgage rates so we do anticipate over time that the full benefit or most of the benefit will be seen by retail customers and indeed we have seen already a significant decline since september and retail mortgage rates. but one thing that is perhaps confusing this issue a little bit is that there are other things happening in the economy which are affecting those spreads. for example, there are capacity limitations which are allowing banks to charge higher yields. there are extra costs like concerns about put at risk for example and there are higher gdp so their number of things happening in the economy which

will tend all else equal to raise that spread between mortgage rates and mbs yields. so that is fortunate. what we can try to do there of course is try to encourage good policy for example on put backs that will reduce the cost at the banks using mortgage loans. most of the things are not in our control but again taking all those issues is confident it seems to be the case over period of time most of the declines they do find their way to mortgage customers and strengthen strength in the housing market.

>> the white house was very controversial as most americans were. there was competition. americans were not having a palace. it was not particularly awe-inspiring and in fact, in 1821 a european diplomat told the congress that it was neither large nor awe-inspiring but the answer the congressman gave said the building fits a purpose. if it were larger and more elegant or haps some president would be inclined to become its permanent resident.

a panel of scientists, doctors and former players told a house panel for human growth hormone testing is reliable and should begin immediately in the national football league. we will hear from linebacker dick butkus who is the founder of the -- and congressman dale issa chairs the house oversight committee. this hearing is an hour and 45 minutes. [inaudible conversations] >> the committee will come to order. the oversight committee exists to secure two fundamental principles or gophers, americans have a right to know that the money washington takes from them

is well spent and second, americans deserve a respective government that works for them arguing on the oversight reform committee to protect these rights are solemn responsibilities to hold government accountable to taxpayers. taxpayers have a right to know what they get from their government. it's our job to work tirelessly in partnership with citizen watchdogs to deliver the facts to the american people and bring genuine reform to the federal bureaucracy. our committee's resources are limited, but in one area we have focused for more than six years and that is taking drugs and dangerous substances out of professional sports. we do so on a bipartisan basis and we do so because of the fact that what professional sports do is what the league of sports do and it's what children aspire to

do. we cannot take professional sports in the eye solution because ultimately, it trickles down to the youngest. when we began our work on a bipartisan basis on steroids in baseball, steroids became common at the high school level. today i believe it is dramatically reduced but not eliminated. on their own, with some push from congress the national football league signed the historic union agreement that banned human growth hormone from professional football. they did so with a time limit that would have in fact put it into play last season. we are now finishing this season and no such implementation has occurred. this committee ranking member cummings at myself have been on multiple occasions with the

parties encouraging them to work out their differences and supported their agreement to try to bring the contract into compliance. we are here today because in fact it hasn't happened, because america is watching and because both the ranking member and myself are personally concerned that the injuries, particularly head injuries that all football played at all levels in mode -- no small part is based on the strength of the players. human growth hormones can impact, and we will hear testimony this event, be a part of this. it is a tough sport when played ominously by people of good solid training and physical conditioning. we need not make it tougher or more dangerous by the use of van

substances. this committee is here today to hear from the parties who can in fact help us and from one well-known player who knows it personally as it has impacted upon him time in and time again. it is our hope that this hearing will morrow for the parties closer together or at least have the american people clearly understand that in fact much of the science has been not just done but redone and if we are to have the kind of clean game that americans love, this needs to be an element of the testing. so without i want to thank all of our winces but i particularly want to thank the ranking member. this has been one of those examples in which there is not only been bipartisan behavior and nonpartisan behavior. never had we had a closer tie on

this issue. >> i want to thank you mr. chairman for your words and i agree with you totally. i want to underscore that the league understands this and the players understand this and the union understands this. there is no daylight between his position and mind. this is a bipartisan effort and i am very delighted that it is because i think it's so very important. thank you mr. chairman and thanks to all of our winces for being here. today's hearing is not only about human growth hormones, this hearing is about millions of young people throughout the country in high school and college who look up to professional athletes and the links to which these young people go to emulate their role models. let me tell you about some of the people in my

district 40 miles away from me in baltimore of many of whom come from very challenging backgrounds and from very difficult home situations. they have dreams about making its as lawyers and teachers and maybe even a congressman. i have seen their smiling faces at graduation. i have seen them on the bus stops at 2:00 in the morning, trying to get to practice. i see them coming home late from practice. they tell me about during the late hours doing homework, dead tired. they are dedicated. they are smart and they have amazing potential but that word potential is a very significant word. i have often said that our children are the living messages we send to a future that we will never see. the question is whether we will send them there with diabetes or

will we send them there with heart disease, or will we send them there with mental problems? some of these young people dream about becoming ballplayers, even beyond their wildest expectations and when they see a freshman become the heisman trophy winner, they feel that it's within reach. when i meet these young people, share the same advice my parents gave me. that is, there are no shortcuts in life. if they want to become a best-selling author or if pro-bowl linebacker for the baltimore ravens they have to put in the work to reach their goals. when they see their role models in sports using illegal drugs to try to get an edge, and when had they have seen a professional league looking the other way, they start thinking they need to use these substances just to compete. so that there will be no

confusion i must credit commissioner heddell for his efforts not only with regard to protecting players but he has also been one who has been pushing to make sure that this happens and he is said that that to the chairman and i and i want to make sure that is clear, that he has been very adamant about this. these young people have high expectations and they are reaching. hgh is a dangerous drug with short-term and long-term risks. let me read you a few of the negative health effects of hgh. hypertension, diabetes, arthritis, bone spurs, spinal stenosis, disfigurement and cardiac dysfunction. these come directly from a scientific journal article published an bias of the study be placed into the record. >> without objection, so ordered.

>> there is no serious -- in the scientific community that its is uses effective. this which has been in place for the past decade is designed to be conservative in order to avoid -- and is one of our winces will testify today you are more than likely to get struck by lightning than to be getting a false positive on an hgh test. also on august 4 as the chairman has said 2011 more than a year ago the nfl association entered into a contract accepting nfl players quote by the first week of the 2011 regular-season end of quote. as we all know that season passed without hgh testing and now the 2012 season will also pass without it. despite their commitment lawyers for the players association now say they did not take the hgh test. although it has been used for

years on olympic affects major league baseball players they argue the nfl players are somehow different. they claim their bodies are not the same as runners, weightlifters and thousands of other athletes who attempted regularly. they say they need more time to study the issue before doing what they agreed to do. to me it seems obvious that the association is simply running out the clock. although they have agreed to hgh testing there now trying to back out of the contract. today we will have the opportunity to hear directly from medical experts and we will examine the claims of the players association under the bright light of science. finally let me address one point that has been raised which is why congress is getting involved in this issue. i'm sure the chairman agrees with me that this should be resolved by the nfl and the players association. we wish there could be or there would be. they have a contract and they

should honor it but when they refuse to do so, that sends exactly the wrong message to the kids we have sworn to protect protect and that is when it becomes our business. finally on a personal level, i have worked most of my life in public service. i've i have helped with the formation of -- that is reach more than 30,000 young athletes, coaches and parents warning them about the dangers of these substances. the groups directed by my spearheaded effort to prevent young athletes from being brainwashed by the mantra of quote winning at all costs and again mr. chairman i cannot tell you how grateful i am to you and the cooperation we have had on this issue and i'm looking forward to working with you and there's another thing that keeps coming up and i keep being asked the question, why do you just

have the experts here in and why in why don't you have nfl players? you can expound on this later i guess, this may be very well the first of several. we wanted to get the science out on the effects it's having on our young people and with that mr. chairman i yield back. >> i think the gentleman. i might note i'm not recognizing the only football player here on the day is because my understanding was they threw a flag anytime you said. >> for a point of clarification i was a place kicker, not an actual football player. >> all the more reason not to recognize him. >> since we are being very bipartisan i want to remind the ranking member that we share the baltimore ravens as i was born and raised in cleveland. [laughter] it was cold. >> it was cold. we now welcome our witnesses.

mr. dick butkus and nfl hall-of-famer leads the organization which encourages student athletes to play sports without performance-enhancing drugs. welcome. dr. larry bowers is the chief science officer of the u.s. anti-doping agency and very important to today's hearing. dr. larry tabak is the deputy director of the national institutes of health and an expert in the field. mr. mike mike gimbel is director of powered amy at st. joseph medical center and dr. linn goldberg is the head of the division of health performance in sports medicine and director of the human performance laboratory at the oregon health and science university. pursuant to our committee rules and because we absolutely want

people to know that we treat everyone equally, please all rise to receive the oath. and raise your right hand. this is the photo moment you have all waited for. do you solemnly swear or if her in the testimony you're about to give will be the truth, the whole truth and nothing but the truth? please be seated. let the record reflect that all witnesses answered in the affirmative. as the ranking member said, today really is about the science and a lead into what will if necessary be a series of hearings until in fact this issue is resolved. so i would ask that your entire opening statements be placed in the root and that if you run short of time as the former chairman you would say, green we know that means go and yellow, that means go real fast through the intersection and stop means don't run it any more.

so if you will come as close to that is as possible we appreciate it. dr. tabak. >> good morning chairman and ranking member. >> the other thing is, the microphone in order not to get people behind you in the conversation you have to -- [inaudible] >> good morning chairman issa and ranking member cummings and distinguished members of the committee. i'm here today describe our understanding of the status of the science pertaining to the nonmedical use of the human growth hormone which i will refer to as hgh including its adverse effects and to discuss prevailing methods for illicit use of hgh in professional sports. at hgh is a natural product of the pituitary gland with a central role in human development. much of our current understanding about the physiological and psychological

effects of hgh on the human body comes from decades of studying and treating patience suffering from growth hormone disorders. nih has a long history of supporting gradeschool research to understand the often devastating effects of deficient orbs as a function of the growth hormone system. hume on -- human growth hormone therapies became a mainstay of modern medicine particularly after the development in 1985 of the safe and viable source of her competent hgh is synthetic protein produced by dna technology that has -- to the pituitary derived hgh. hgh can stimulate tissue growth, linear growth and metabolism. it promotes and increases lean body mass. the fda has improved recombinant hgh for a number of clinical indications associated with

growth hormone deficiency both in adults and children. in patience with growth hormone deficiency with improved aspects of exercise capacity and some studies have suggested it improved mood. given the well-documented ability up for competent hgh for tissue build up some athletes began abusing her competent hgh to enhance their performance. further increasing the appeal for competitive athletes is the fact that it stimulates the production of another hormone growth factor one that exhibits the breakdown of proteins. their claims that inhibiting protein breakdown can help prevent some of the muscle and tendon damage that results from the chronic abuse of anabolic steroids. this was unproven but it may explain why free competent hgh is used in combination with anabolic steroids at high doses for several months per good

phenomenon that has now come to for getting understanding of potential consequences of the nonmedical use of free competent hgh. studies performed to date have found little or no evidence that increasing body mass that can result from a naturally high doses of her company at hgh have any effect on the strength power or capacity of healthy individuals. nonmedical use of for competent hgh might decrease performance by increasing exercise for lactic acid and muscles which promotes fatigue. based on -- with growth hormone deficiency athletes who abuse hgh are putting themselves at serious risk. although much of what we know of the effects associated with high doses of for competent hgh derived from individual case reports and akel evidence or

therapeutic records what we know about the biology of for competent hgh and the long clinical history of treating patients with it points to a worrisome list of possible adverse consequences including the development of some of the features of -- as well as risk for developing hypoglycemia, diabetes, cardiomyopathy, drug-induced hepatitis, renal failure, soft tissue edema, joint pain, carpal tunnel syndrome and -- the available information suggests recombinant hgh or taking serious respect their health and may not realize there is no scientific evidence that the practice will improved their resilience in competition. knowledge of the potentially adverse health consequences associated with recombinant hgh abuse has prompted efforts to deploy a